Correlation Between Astronics Corp and VirTra
Can any of the company-specific risk be diversified away by investing in both Astronics Corp and VirTra at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Astronics Corp and VirTra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astronics Corp Cl and VirTra Inc, you can compare the effects of market volatilities on Astronics Corp and VirTra and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Astronics Corp with a short position of VirTra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astronics Corp and VirTra.
Diversification Opportunities for Astronics Corp and VirTra
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Astronics and VirTra is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Astronics Corp Cl and VirTra Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VirTra Inc and Astronics Corp is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Astronics Corp Cl are associated (or correlated) with VirTra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VirTra Inc has no effect on the direction of Astronics Corp i.e., Astronics Corp and VirTra go up and down completely randomly.
Pair Corralation between Astronics Corp and VirTra
Assuming the 90 days horizon Astronics Corp Cl is expected to generate 0.92 times more return on investment than VirTra. However, Astronics Corp Cl is 1.08 times less risky than VirTra. It trades about 0.02 of its potential returns per unit of risk. VirTra Inc is currently generating about -0.02 per unit of risk. If you would invest 1,760 in Astronics Corp Cl on November 3, 2024 and sell it today you would lose (84.00) from holding Astronics Corp Cl or give up 4.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.89% |
| Values | Daily Returns |
Astronics Corp Cl vs. VirTra Inc
Performance |
| Timeline |
| Astronics Corp Cl |
| VirTra Inc |
Astronics Corp and VirTra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astronics Corp and VirTra
The main advantage of trading using opposite Astronics Corp and VirTra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astronics Corp position performs unexpectedly, VirTra can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in VirTra will offset losses from the drop in VirTra's long position.| Astronics Corp vs. Firan Technology Group | Astronics Corp vs. 808 Renewable Energy | Astronics Corp vs. Park Electrochemical | Astronics Corp vs. Innovative Solutions and |
| VirTra vs. Innovative Solutions and | VirTra vs. Park Electrochemical | VirTra vs. Ducommun Incorporated | VirTra vs. National Presto Industries |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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